Interlinkage and Generous Tit-for-Tat Strategy
AbstractWe investigate an infinitely repeated prisoners' dilemma with imperfect monitoring and projects the possibility that the interlinkage of the players' distinct activities enhances implicit collusion. We show a necessary and sufficient condition for the existence of generous tit-for-tat Nash equilibrium. Such an equilibrium, if it exists, is unique. This equilibrium achieves approximate efficiency when monitoring is almost perfect, where the discount factors are fixed.
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Bibliographic InfoPaper provided by CIRJE, Faculty of Economics, University of Tokyo in its series CIRJE F-Series with number CIRJE-F-875.
Length: 11 pages
Date of creation: Feb 2013
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This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-02-16 (All new papers)
- NEP-CTA-2013-02-16 (Contract Theory & Applications)
- NEP-GTH-2013-02-16 (Game Theory)
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